VOLUME XXI,  NUMBER 7 - JULY,  2019

News & Analysis

Looking at NHRA’s 2017 Tax Return

 

NHRA Tax Return Shows Return to Profitability

By Jeff Burk

As regular readers of DRO are aware, for several years we have re-printed portions of the NHRA’s annual income tax returns along with some analysis of the numbers so that NHRA’s approximately 40,000 dues-paying members can have some idea where the “not for profit” tax exempt pseudo-sports entertainment company is spending its money and who is getting it.

 

The 2017 tax return is basically Peter Clifford’s report card for his two and a half year reign as the NHRA President that started in July of 2015 when he officially replaced Tom Compton. Based upon what Mr. Clifford accomplished in that relatively short period of time he probably would get an A as a grade.

 

The NHRA hasn’t had revenues of over $100,000,000 since 2011. In fact, the NHRA’s gross revenues for 2017 are $94.7 million, delivering a cash surplus of $850,000. Under Peter Clifford’s management the NHRA went from losing almost nine million dollars in revenue combined for the 2015 and 2016 seasons to positive cash flow in 2017, Peter Clifford’s last as the NHRA president and moving on as the first CEO of the NHRA.

 

Mr. Clifford accomplished that feat the old-fashioned way: he cut costs. In 2016 and again in 2017 he reduced yearly spending by approximately $5 million. That decrease in spending was brought about by reducing the staffing of both revenue and non-revenue generating divisions of the NHRA and even reducing the total salaries paid to NHRA’s management team by almost a half-million dollars from $4.8 million to $4.4 million even while adding at least two new hires to the management staff. Despite that total salaries paid for the company dropped from $25.1 million to 22.9 million.

 

Mr. Clifford didn’t accept the presidency until July of 2015 so he really couldn’t make any significant changes until 2016. The NHRA spent $5 million less ($98.7 million) in 2016 than it did in 2015 ($103+ million) and in 2017 total expenses for the year came in at $93.9 million.

 

In the 40+ page return there were a few interesting factoids that presented themselves.

1. NHRA membership continues to dwindle ($3.28 million in dues for 2016/$3.11 million in 2017). The NHRA as an automotive sanctioning body still has 40,000+ members and that number dwarfs any other sanctioning body members.

2. In 2017 event admission revenues were up slightly over the 2016 number.

3. In 2017 the NHRA spent $2 million less on advertising and promotion than in 2016.

4. Tom Compton got a $500,000 payday in addition to the $600,000 stipend he was given in 2016.

5. Of 11 members of the NHRA management team only Peter Clifford ($1,003,320) was paid more in 2017 than NHRA lawyer Linda Louie ($459,581).

page 2 of 2017 return

page 8 of 2017 return  

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